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Have you ever wondered what might be lurking in your credit report that could squash your chances of obtaining a decent auto loan rate, credit card, or even a mortgage? Well, if you're like many Americans who have taken advantage of their right to obtain free copies of their credit reports under the Fair Credit Reporting Act (FCRA), then you shouldn't be worried. Instead, you should sleep peacefully at night, knowing exactly what data is listed on your report.
However, what if you aren't one of those lucky Americans sleeping peacefully at night because you have no idea what's inside your report, let alone if it's good news or bad news?
Take comfort in this: Accessing your credit report is easy, and it won't cost you a dime. Additionally, the type of information listed on your report is likely to get a whole lot easier to read and understand, thanks to a proposed set of revisions from the U.S. Federal Trade Commission (FTC).
What Are Credit Reports?
Credit reports contain information about individuals' borrowing and bill-paying habits. Lenders use such information to assess someone's credit worthiness and ability to repay a loan, and also to establish interest rates and other loan terms. A document with this much power to affect your finances needs to be monitored closely and consistently. The FTC recognizes the importance of communicating this information to consumers in the best way possible, thus the reason behind the proposed changes.
So what's changing? On the horizon are likely some changes to what type of information you receive from consumer reporting agencies and how that information is displayed. In other words, when you request your free credit report from one of the three national credit agencies that provides consumer information - Experian, Equifax and TransUnion - the type of data you receive should be easier to understand.
The FTC's proposed changes would:
The proposed changes are designed to reflect new rules that the FTC and other financial regulators enacted under the Fair and Accurate Credit Transactions Act of 2003. At the time of this writing, the FTC was reviewing public comments on the proposed revisions listed above and nothing has been finalized yet. However, CareOne will keep you informed of any changes and how they impact you.
Order Your Free Credit Report
In the meantime, if you haven't seen a copy of your credit report in a while, there's no better time than today to request yours. Simply visit www.AnnualCreditReport.com, the only authorized source for the free annual credit report that's yours by law. Once on the site, you'll be asked to enter your full name, date of birth, Social Security number (which will be encrypted when your request is transmitted), and address. You can then choose from which of the three nationwide credit reporting companies you'd like to receive your credit report - Experian, Equifax and TransUnion.
The FCRA provides consumers with free access to a report from each company every 12 months. CareOne advises consumers to stagger their requests in order to closely monitor their credit report throughout the year. In other words, place your requests as follows, using this sample schedule:
Why is all of this effort worth it? What if a provider of credit information accidentally communicated some incorrect data to one of the credit reporting agencies? The domino effect of this one small error could have serious repercussions on your credit score and your resulting ability to obtain credit.
One final word of caution before you request your credit report. Beware of copycat websites, and TV, mail, or email offers offering a copy of your report for a fee or in exchange for buying other services. The AnnualCreditReport.com website is the only authorized service that truly provides reports at no cost to consumers and the only site CareOne encourages you to visit today. Once armed with your free report, you'll join your fellow Americans who are savvy enough to keep firm tabs on their credit information, rest peacefully, and walk confidently into their next loan negotiation.
All those facts and figures on your credit card statements may be intimidating, but reading and using this information each month helps you stay in control of your finances.
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